The Value of ERP for General Contractors report suggests software is a competitive advantage in the construction sector. (Cover image courtesy of Dodge Construction Network and CMiC)
New research from Dodge Construction Network and CMiC confirms what high-performing contractors already know: ERP systems deliver measurable results.
According to their data, general contractors using Enterprise Resource Planning (ERP) software are more than twice as likely to say they are highly data-driven, while 71 per cent of specialty trade users report effective crew time management. That compares to just 43 per cent when trade contractors are using alternative tools.
The insights come from a pair of complementary studies, The Value of ERP for General Contractors and The Value of ERP for Specialty Trade Contractors, which together offer a comprehensive view of ERP adoption and impact across the construction industry. While each group has unique needs, the research points to a shared truth: firms using ERP are consistently outperforming those that don’t.
ERP adoption is a strategic advantage
While each audience has distinct challenges and adoption patterns, the data indicates that contractors who invest in ERP, especially over time, are outperforming their peers in critical areas like project controls, crew time management and data-driven decision-making.
“ERP adoption has moved well beyond the early adopter phase. It’s now a mainstream business practice among general contractors and widely used by the trades,” said Steve Jones, senior director of industry insights at Dodge Construction Network. “With 53 per cent of GC users having seven or more years of experience, their long-term investment is clearly paying off. Trade contractors are also narrowing the gap… Contractors using ERP are consistently outperforming their peers, and those across the industry still operating without it are increasingly at a competitive disadvantage.”
The performance gap
According to the reports, almost nine out of 10 general contractors using ERP software, and eight of 10 trades contractors, report overall satisfaction with their ERP system.
That may not be surprising given that 79 per cent of general contractors using ERP systems rate their project controls as highly effective, compared with just 38 per cent using alternative tools.
Likewise, more than twice as many GC ERP users rate their organization as highly effective at using data analytically compared to non-users.
The study also found that integrating external data into ERP systems significantly enhances performance. The majority of GC users integrate external data into their ERP functions, and more than half of trade contractors do so for seven of the 11 functions included in the studies.
According to the research, the more data that is integrated, the more valuable ERP becomes in delivering real-time, actionable insights, and the ability to connect and centralize information is a key advantage for more sophisticated users.
While ERP systems are delivering results, many construction firms still have room to grow as many firms continue to rely on spreadsheets, manual processes or third-party tools, limiting ERP’s ability to support fully integrated, real-time workflows.
“As the global leader in construction-specific ERP solutions, we have dedicated ourselves to helping contractors realize the full potential of their technology investments,” said Jeff Weis, chief revenue officer at CMiC. “Through five decades of partnering with contractors worldwide, we’ve discovered that the path from ERP adoption to maximum value realization hinges on three critical factors: comprehensive integration capability, strategic user training and, most of all, organizational commitment to ERP as the central operating system.”
Both reports can be downloaded from Dodge Construction Network at www.construction.com.
